My favorite economist and commentator puts the Madoff scandal in the proper perspective.
There is one point Krugman doesn’t make which is the reason why I am commenting on this: the greed that fuels Wall Street is the same greed that leads to war. It is no coincidence that Bush & Co removed all remaining restraints on Wall Street while waging two major wars. Although I wouldn’t call myself a Marxist, I definitely am among those who believe that, for the most part, war is a racket.
Most people react to such events by demanding the scoundrels be thrown in jail. I don’t think that is either useful or appropriate. Obviously jail sentences don’t serve as a deterrent. They are also don’t serve justice. Take Michael Milken as an example. He served only 22 months and left jail still a billionaire. Instead of throwing thieves in jail, their punishment should be that everything they own is confiscated. Justice is served in two ways. Firstly they can’t benefit by their ill gotten gains. And secondly the proceeds can be used to partially compensate the victims.
By the way, when I say thieves I am not just talking about Madoff. The wealth of all Wall Street traders should be confiscated. Krugman writes:
In recent years the finance sector accounted for 8 percent of America’s G.D.P., up from less than 5 percent a generation earlier. If that extra 3 percent was money for nothing — and it probably was — we’re talking about $400 billion a year in waste, fraud and abuse.
$400 billion dollars goes a long way to make up for all the taxpayer money spent on the bailouts caused by Wall Street greed and irresponsibility. The CEOs of the auto companies should also be on the list. And while we are at it, why not confiscate all of Bush, Rumsfeld and Cheney’s wealth. The list goes on and on. Makes so much sense, doesn’t it?
Tags: War Racket